MARK KELVIN C. VILLANUEVA
Divine
Word College of Laoag, Ilocos Norte, Philippines
Abstract
This paper discusses the importance of business ethics in tourism and hospitality operations and the principles that must be adhered to. Many managers are challenged and frequently face ethical dilemmas that necessitate serious analysis; this study examines common issues and their implications in the said industry. This paper also presents the common ethical practices which lead to a healthier workforce and working environment and lead to long-term success of tourism and hospitality businesses.
Keywords: ethical, tourism, hospitality, industry
Introduction
Ethics plays a crucial role in the sustainability of business practices and guide companies to work in a manner that is morally and socially responsible. It also ensures that actions and activities are observed for a win-win situation to all stakeholders and to society. In the tourism and hospitality sectors like hotels, food service businesses and travel and tours operators are anticipated to maintain business practices that are not only honest but also fair, all while aiming to optimize their profits (Nicolaides, A., 2019). Furthermore, companies within this industry that adhere to strong ethical principles tend to cultivate a positive reputation, earn the trust of their clientele, enhance the sustainability of tourism enterprises.
Understanding the Importance of Ethical Management in Hospitality Industry
Ethical management in the hospitality industry is crucial in achieving success and ensuring customer satisfaction. Wherein implementation of virtuous practices and approaches are the responsibility of the different business organizations (Ipag Business School, 2021).
The following are the importance
and benefits of ethical management in the tourism and hospitality industry:
- Building a good
reputation and gaining the trust of customers. Tourism and
hospitality businesses observing ethical behavior tend to build a good reputation
and gain customer trust. Customers who are pleased with their ethical
experiences are more inclined to suggest the tourism provider to others
(Kusumah, 2023).
- Determining your
hotel’s long-term success and competitiveness. Operating a hotel
with strong ethical principles is a strategic choice that can influence
the long-term success and competitiveness of your establishment. By
prioritizing authenticity, your hotel can foster solid connections with
guests and retain skilled employees (Lacalle, 2023).
- Tend to be more
profitable than other companies. Companies can gain higher
income and advantages by operating their businesses in a more ethical and
responsible way. (Dimitriou,
C. et al., 2024).
- Improving
share value, client retention, and attraction of new clients, investors,
and employees.
Thomas (2016) highlighted that hotels and resorts that
prioritize ethical responsibility tend to see an increase in their share
value, retain clients more effectively, and attract new clients,
investors, and employees. Furthermore, these organizations often face a
reduced risk of compliance violations and demonstrate improved financial
performance.
- Ensuring
Guest Satisfaction: Ethical leaders focus on
ensuring guest satisfaction by maintaining high levels of service quality
and integrity. They guarantee that guests are provided with truthful and
precise information, treated fairly, and offered outstanding service,
which contributes to positive experiences for guests and encourages repeat
business (Guest Delight International, 2024).
- Mitigating
Risks and Maintaining Compliance: Ethical
leaders maintain compliance with legal and regulatory standards,
guaranteeing that the hotel functions in an ethical manner and adheres to
industry regulations. By emphasizing integrity and ethical behavior,
leaders reduce risks associated with legal liabilities, harm to
reputation, and employee misconduct (Guest Delight International, 2024).
- Increasing
Employee Performance and Morale. Ethics
encompasses not only a company's relationship with its customers but also
the internal culture it fosters. When employees experience fair treatment,
equal opportunities, and work in a setting free from discrimination or
harassment, their motivation and productivity increase. Ethical practices
contribute to higher job satisfaction and employee loyalty, resulting in a
dedicated and driven workforce. Content employees are more inclined to
provide outstanding service, thus improving the overall experience for
guests (Holistique Training, 2023).
- Adapting
to Changing Consumer Expectations. The
contemporary consumer is increasingly knowledgeable and aware of social
issues. Factors like environmental sustainability and fair employee
treatment play crucial roles in how consumers make their purchasing
choices. Hospitality companies that emphasize ethical practices are not
just aligning with present-day expectations but are also securing their
future viability. By adapting to changing ethical standards, these
businesses can remain relevant and appealing to the socially conscious
consumers of the future. (Holistique Training, 2023).
- Fostering a Positive Work Environment. Ethical companies emphasize fairness, respect, and inclusivity within their work environments. This approach leads to employee satisfaction and cultivates a positive atmosphere marked by teamwork, creativity, and innovation. When employees trust the ethical principles of their workplace, they are more inclined to make positive contributions, which enhances a lively and dynamic workplace culture (Holistique Training, 2023).
Ethical Challenges in Tourism and Hospitality Industry
The foundations of ethical
behavior in the tourism and hospitality sector are clearly defined, however,
the industry frequently faces challenges that exist in the ambiguous zones
between right and wrong. Such ethical conflicts require thorough examination
and deliberate management.
The
following are common challenges of tourism and hospitality professionals in
terms of the implementation of ethical management.
- Balancing Profit and Social Impact. Finding the right
balance between making profits and engaging in social responsibility is a
major challenge within the ethical framework of the hospitality sector.
Ethical businesses find innovative ways to positively impact their
communities, including supporting local charities, taking part in
educational initiatives, and encouraging environmental sustainability.
While it is essential to remain profitable for long-term sustainability,
ethical organizations intentionally set aside a portion of their earnings
for meaningful social programs, thus creating a synergy between financial
success and social responsibility (Holistique Training, 2024).
- Animal Welfare in Hospitality. Ethical
challenges emerge regarding the acquisition and processing of animal
products within the food industry. Responsible establishments acknowledge
the significance of humane treatment in animal agriculture, making efforts
to procure products from suppliers dedicated to animal welfare.
Furthermore, certain businesses choose to offer plant-based options to
meet the increasing desire for ethical dining experiences.
- Cultural Sensitivity and Respect. The diverse
landscape of hospitality frequently tests cultural awareness and respect.
Responsible organizations prioritize cultural training for their
employees, ensuring that their interactions are respectful and free from
cultural prejudices. Ethical hospitality professionals address these
challenges by creating an inclusive atmosphere, where every guest is
recognized, appreciated, and treated with dignity, considering factors
such as dietary needs and religious customs.
- Responsible Tourism and Overtourism. The
growth of international tourism has sparked worries regarding responsible
tourism and the issue of over-tourism. Ethical businesses practice
responsible tourism by promoting respect for local cultures and
environments among their guests. Additionally, they take part in community
development projects to reduce the adverse effects of over-tourism. By
adopting responsible tourism practices, hospitality organizations can
effectively manage the challenges of increased visitor numbers while
safeguarding the authenticity and welfare of the local community.
- Implementing business ethics in tourism and hospitality operations can have challenges, such as the added costs of adopting socially and environmentally responsible practices (Kusumah, 2023).
Ethical Practices in Tourism and Hospitality Industry
Ethics are essential for maintaining integrity, ensuring the future success of business, and caring for customers and employees. By adhering to established hospitality management principles, it can prosper and steer clear of common challenges faced in the tourism and hospitality industry. The following are ethical practices observed in tourism and hospitality businesses.
- Treating
your employees fairly. Ensuring fair treatment of employees is a crucial
ethical obligation within the hospitality sector. It is essential to
provide competitive salaries, maintain safe working environments, and
offer equal opportunities, irrespective of race, socioeconomic status, or
educational background. In addition, zero tolerance for harassment and
discrimination and empowering employees must be take into consideration
(Lacalle, 2023). Authority figures, such as supervisors or managers, who
are seen as acting justly, tend to gain trust, which can lead to improved
performance. On the other hand, employees who perceive unfair treatment
are more inclined to display behaviors that can be detrimental to the
organization or its members ( Eib et al., 2017)
- Data
Privacy. Many hospitality companies dedicate resources and
time to effectively gather and analyze data to enhance sales, customer
service and loyalty, as well as operational efficiency. Recent
technological developments have simplified the management of diverse information
regarding customers, suppliers, and staff (Montera, 2012). In Bukilić's
study (2024), it was proposed that the hospitality and tourism sector must
tackle issues related to data privacy. This can be achieved by clarifying
privacy policies, offering more transparent opt-out options, and
committing to ethical data management practices. These steps are essential
for maintaining the trust of consumers who are concerned about their
privacy.
- Regulatory
compliance. Meeting legal responsibilities is essential for a
business's success. This encompasses compliance with labor laws, health
and safety regulations such as ensuring fire extinguishers are available
on each floor and having an evacuation plan and other legal mandates.
Numerous governments have established regulations aimed at enhancing
inclusivity for individuals with disabilities and mobility challenges.
This involves the installation of elevators and ramps to facilitate
wheelchair access, along with providing sufficient space for maneuvering
within hotels (Lacalle, 2023).
- Environmental
responsibility. Climate change has redirected our attention
towards environmental issues. The hospitality industry is known for generating significant waste
and with this, advocating for
eco-friendly practices can minimize its carbon footprint. Hotels can
contribute by conserving energy, minimizing waste, and implementing
reduce, reuse, and recycle strategies, thereby serving as positive role
models within their local communities
(Lacalle, 2023).
Sustainable tourism aims to reduce harmful effects on the
environment, protect both natural and cultural heritage, and enhance the
quality of life for local communities (Lica, D., Gashi, S. and Qosja,
2024).
- Responsible marketing and advertising. Responsible marketing and advertising entail representing your accommodations and services truthfully, steering clear of misleading promotions, and demonstrating cultural awareness. Marketing initiatives should showcase guests from diverse backgrounds and maintain a commitment to social responsibility and honesty (Lacalle, 2023). Practicing social responsibility in marketing offers numerous advantages, as it hinges on building trust and demonstrating foresight within businesses. Cultivating and maintaining trust with customers, communities, and regulators is challenging and can be easily compromised or lost (Mathur, 2016).
Conclusion.
In conclusion, ethical leadership
is essential for success in tourism and hospitality operations. Prioritizing
work ethics reaps substantial benefits, not just about compliance but also
creates a culture where every stakeholder—guests, employees, management, and
the community—feels valued, respected, and secure. With the increase in
competition and evolving trends in tourism and hospitality operations, ethical
leadership remains a strong foundation of sustainable growth and reputation
management.
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